How to Actively Cultivate Rural Mutual Credit Cooperative Organizations
The difficulty of obtaining loans and financing in rural areas has for many years been a prominent problem constraining agricultural and rural development. Starting in 2008, Zaozhuang City in Shandong Province took the lead nationwide in carrying out reform of the rural land use rights system, which fairly well solved the funding difficulties for cooperative development and large-scale operation. However, with the development of the agricultural and rural economy, the funding needs of various types of rural business entities have also become increasingly diverse, and in particular the problem of “difficulty in obtaining small loans” for the millions of individual farming households has become more and more prominent. At the beginning of this year, in conjunction with the Party's mass line education and practice activities, I and relevant colleagues spent more than a month conducting concentrated research on this issue, successively visiting 5 townships and 11 administrative villages, and conducting a sample survey of 450 farming households. On this basis, we carried out comprehensive analysis and in-depth discussion, and reached some consensus.
Current Status of Funding Needs of Individual Farming Households in Zaozhuang
At present, the funding needs of farming households fall mainly into two major categories: first, production-related funding needs, and second, consumption-related funding needs. We focused our investigation on production-related funding needs. The survey shows that most farmers' funding needs in the production process generally have the characteristics of small amounts, strong urgency, strong seasonality, and few assets available for collateral.
1. In terms of the proportion of demand, farming households have a strong demand for funds. 42% of farming households showed a relatively strong demand for funds. Calculated at this proportion, the whole city has approximately 336,000 households and 1.2 million people experiencing funding shortages to varying degrees.
2. In terms of the type of operation, the funding needs for grain cultivation are small, while those for livestock and aquaculture, vegetables, forestry and fruit, and processing are larger. Grain cultivation is mostly 0.5 wan yuan per household; vegetable cultivation is mostly 1.5 wan yuan per household; economic forestry and fruit cultivation is mostly 3 wan yuan per household; livestock, poultry and aquaculture is mostly 2.5 wan yuan per household; and agricultural product processing is mostly 5 wan yuan per business. The amounts are generally not large, at around 1—5 wan.
3. In terms of the use of funds, the demand for maintaining production is small, while the demand for upgrading or expanding production is large. Among farming households with funding needs, only about 18% are for maintaining production; most are for developing facility agriculture or expanding reproduction.
4. In terms of the timing of use, the urgency is strong, the seasonality is strong, and the cycle is short.
At present, large commercial banks only pay attention to high-quality clients with relatively large operating scale in rural areas. Even rural credit cooperatives that are “native and locally grown” in rural areas no longer accept loans of 3 wan yuan or less, and the loan needs of most farming households still cannot be met. From the reality of rural areas, the most effective way to solve the problem of small-sum funds for farming households is to develop rural mutual credit cooperative organizations.
Four Models Explored by Zaozhuang for Developing Rural Mutual Credit Organizations
First, setting up a credit department within a cooperative to achieve mutual credit. Members are attracted to deposit funds from product sales settlements, idle funds, and so on, while members with funding needs can obtain the funds needed for production and operation after passing a mutual credit review. This method not only satisfies members' demand for development funds, but also improves the utilization rate and rate of return of idle funds in members' hands. Up to now, the whole city has set up credit departments within 39 cooperatives, with mutual credit amounts reaching 38 million yuan.
Second, establishing rural mutual credit cooperatives to achieve mutual credit. Relying on land cooperatives, rural mutual credit cooperatives are established through a “1+1” model. Through members' share subscription and self-raised funds, financing obtained by mortgaging rural land use property rights, and other funds, they carry out mutual credit and credit cooperation to satisfy members' funding needs for production development. The whole city has established 12 rural mutual credit cooperatives, with mutual credit funds of 8.6 million yuan.
Third, the supply and marketing cooperative system achieves mutual credit among cooperatives. The supply and marketing cooperative system established 2 county-level rural credit guarantee companies, and jointly with 17 grassroots cooperatives carried out financing services within the specialized cooperatives they lead. Through connection between specialized cooperatives and guarantee companies, specialized cooperatives deposit surplus funds with the guarantee companies, and the guarantee companies then channel the funds to other specialized cooperatives in need of funds, effectively regulating the surplus and shortage of funds among specialized cooperatives. The balance of mutual credit funds reached 40.35 million yuan.
Fourth, mutual credit achieved through poverty alleviation mutual credit associations. With fiscal poverty alleviation funds as guidance, mutual aid funds voluntarily paid by villagers at a certain proportion as the basis, and socially donated funds obtained without any additional conditions as a supplement, production development funds are established that are owned by villagers, used by villagers, independently managed by villagers, benefit villagers, and are lent on a rotating basis within the village. At present, the city's poverty alleviation mutual credit fund associations have grown to 74, with a total of 12.75 million yuan in special poverty alleviation funds arranged, and 3.8183 million yuan in self-raised funds from members, with a self-raised fund rate of 30%.
As of the end of last year, the total scale of shares, deposits and financing of rural mutual credit organizations in the whole city reached 252 million yuan, effectively alleviating the problems of shortage of funds for farming households' production development and difficulty in obtaining loans. However, judging from the current situation, the overall scale of Zaozhuang's rural mutual credit organizations is still not large, and their coverage is still too narrow, so they cannot fully meet farming households' funding needs. Many farming households do not clearly understand the nature and role of mutual credit, and their enthusiasm for participation is not high. The establishment of management institutions, staffing, and risk prevention mechanisms of rural mutual credit organizations need to be standardized and improved.